Supply issues impact Chevron Phillips and Formosa polyethylene plants

By Frank Esposito
Senior Staff Reporter

Published: May 15, 2013 1:42 pm ET
Updated: May 16, 2013 1:24 pm ET

Related to this story

Topics Materials, Materials Suppliers
Companies & Associations Chevron Phillips Chemical Co. LP

AKRON, OHIO — Production and supply issues continue to impact polyethylene plants operated by Formosa Plastics Corp. USA and Chevron Phillips Chemical Co. in Texas.

Officials with Livingston, N.J.-based Formosa confirmed on May 15 the restart of two of three high density PE lines that had been down since a May 2 fire at its plant in Point Comfort, Texas. Those lines represent about 70 percent of the unit's output, they added.

The third line is expected to be up and running in late June, officials said. Two workers remain hospitalized — both contract workers — from injuries sustained in the fire. Force majeure conditions remain in place for high molecular-weight bimodal grades of Formosa's Formolene-brand HDPE.

"The quantity of product that will be allocated for the month of June is under evaluation," polyolefins vice president and general manager Ken Mounger said in a May 14 letter to customers. "We understand the burden that this ongoing production interruption has placed on [customers]. Formosa is making every effort to return to normal operations as soon as possible."

But just as Formosa was bringing some of its PE capacity back, Chevron Phillips Chemical Co. — based in The Woodlands, Texas — was declaring force majeure on PE because of a minor emissions event at its Cedar Bayou plant in Baytown, Texas.

According to a report filed with the Texas Commission on Environmental Quality (TCEQ), more than 260 pounds of hexene, almost 150 pounds of pentane and three pounds of gaseous ethylene were released from the plant between 11:30 p.m. on May 9 and 3 a.m. on May 10.

The cause of the air emissions event was listed as an incinerator shutdown, which resulted in process degasser streams being routed from the incinerator to the atmosphere.

The PE force majeure was confirmed in a May 14 customer letter obtained by Plastics News. In the letter, Chevron Phillips PE vice president David Morgan said that the firm "has experienced a contingency event and is in a force majeure situation with respect to [Chevron Phillips'] polyethylene supply."

Chevron Phillips "will work diligently to minimize the impact of this event on your business and return to full polyethylene deliveries as soon as possible." Officials with the firm declined to comment on the TCEQ filing.

Chevron Phillips ranks as one of North America's largest HDPE makers with annual capacity estimated at almost 3.5 billion pounds. The firm also operates almost 1.9 billion pounds of linear low density PE capacity and 620 million pounds of annual capacity for low density PE. In addition to Baytown, Chevron Phillips also makes PE at plants in Pasadena and Orange, Texas.


Comments

Supply issues impact Chevron Phillips and Formosa polyethylene plants

By Frank Esposito
Senior Staff Reporter

Published: May 15, 2013 1:42 pm ET
Updated: May 16, 2013 1:24 pm ET

Post Your Comments


Back to story


More stories

Image

PE prices drop for first time in two years, PP down 5 cents

November 26, 2014 10:22 am ET

North American polyethylene buyers might want to circle November 2014 in red on their calendars — since PE prices this month have fallen for...    More

Image

Compounding products and services

November 24, 2014 9:47 am ET

   More

Image

Dow reaches agreement with Third Point

November 21, 2014 9:11 am ET

Dow Chemical Co. has reached an agreement with the investment firm that has been trying to force the company to sell off some assets.More

Image

Ineos making its UK shale play

November 21, 2014 9:29 am ET

Chemical giant Ineos Group AG is planning to be the biggest player in the United Kingdom's shale gas industry.    More

Image

Total to buy majority stake in Polyblend

November 20, 2014 10:04 am ET

French oil and gas giant Total SA will buy a 68 percent stake in Germany's Polyblend GmbH, a subsidiary of Polymer-Chemie GmbH.    More

Market Reports

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 million dollar plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

October 27, 2015 - October 29, 2015Plastics Financial Summit - New York - 2015

More Events